Tues 29-Oct-2024: Lycopodium (LYL) appear to have a downside resistance level of $11 - as shown below:

LYL dropped down to $11 in April and bounced off that level, and then they've recently done it again, since the went ex-dividend, and while they haven't bounced strongly off $11, yet, today's +2.36% SP move is a sign - to me at least - that there are people who believe $11 is low enough to be topping up or getting back onboard again, now that opportunities for dividend harvesting in other companies have been and gone, for the next 4 to 5 months at least, unless you're looking at LICs - like WGB or WLE - or other companies that have ex-div dates in November or December.

Low liquidity is still an issue with LYL, as evidenced by the low volumes at those price points above for the bids (buyers) and offers (sellers), so any buys or sells of any decent volume will tend to move the share price, unless it's done gradually, and even then it still seems to move the share price, as shown in that downtrend over the past couple of months.

Based on $11/share, being what I consider to be a resistance level on the downside, LYL's historical dividend yield is 7%, plus franking, so a grossed-up yield of around 10%. That's based on LYL paying out 77 cps in FF divs in the past 12 months (37 cps interim + 40 cps final). 77c p.a. - must be a sign!

At today's closing price of $11.29/share, LYL's trailing dividend yield is 6.8% or a grossed-up div yield of 9.7%. That's decent compensation for share price volatility when the underlying earnings of the company are growing along with their NTA.

Their latest announcement was of a small bolt-on acquisition (11 days ago): LYL-Signs-Agreement-to-Acquire-Majority-Interest-in-SAXUM [18-Oct-2024].PDF

Another smart purchase, buying 60% up front with an option to buy the other 40% later, with that up-front 60% being paid for in cash, and the acquisition being EPS-accretive immediately, as usual.

Here's an excerpt from that announcement:

Holding no debt and with consistent revenue growth and strong profit margins, SAXUM will contribute immediately to Lycopodium’s revenue and profitability and the acquisition supports Lycopodium’s key strategic initiative to further geographically expand its global presence in the Americas.

Lycopodium’s Managing Director, Peter De Leo, said: “We are extremely pleased to announce this acquisition, which will further enhance our capabilities, expand our service offering and position us more competitively in the global market. SAXUM is a mature business, is culturally aligned with Lycopodium and is an appropriately sized business for us to establish a material footprint in Latin America to complement our Lima office as well as supporting our ingress into the US market.”

Post-acquisition, the SAXUM brand will be retained and the company will continue to be managed by the incumbent leadership team, which will not only secure trust with existing clients but also positions SAXUM for further expansion and success in its markets.

SAXUM founder and CEO, Dr Guillermo Etse, said: “We are thrilled with the opportunity to join the global Lycopodium family. I believe this is an excellent fit for our business, as we too are a technically led, client focused and value centric business.”

The acquisition will be funded from cash reserves, and it is anticipated the purchase will be finalised in Q1 2025, at which point further details will be provided.

--- end of excerpt ---

This acquisition further strengthens LYL's position in South America, a part of the world that they want to win more work in.

Fun fact: Lycopodium is a genus of plant:

lycopodium

in British English

(ˌlaɪkəˈpəʊdɪəm )

noun

any club moss of the genus Lycopodium, resembling moss but having vascular tissue and spore-bearing cones: family Lycopodiaceae

See also ground pine (sense 2)

Collins English Dictionary. Copyright © HarperCollins Publishers

Word origin

C18: New Latin, from Greek, from lukos wolf + pous foot

Source: https://premabotany.blogspot.com/2018/12/lycopodium-classification-structure-of.html

They were once the engineering arm of Monadelphous Group. Monadelphous has similar botanic origins:

monadelphous

[ mon-uh-del-fuhs ]

adjective

, Botany.

1. (of stamens) united into one bundle or set by their filaments.
2. (of a plant or flower) having the stamens so united.

Source: https://www.dictionary.com/browse/monadelphous

In MND's own words: The Monadelphous name is inspired by the botanical term, where plant stamens and filaments unite to form a single bundle. The hibiscus is a great example of this. Our name signifies the coming together of many to a single point for strength and unity of purpose.

Lycopodium also has a similar botanic meanings. Additionally, LYL's website says this:

What is a Lycopod?

The term ‘Lycopod’ was first coined by our people to describe, well, themselves. If you’re a Lycopod then you have that special something that makes us, our teams and our solutions different. Lycopods are not conformists. Far from it. They have different personalities and capabilities, but share a certain professional mindset, confidence and an innate ability to work together – sharing ideas, insights, responsibility. They make our culture.

Source: https://www.lycopodium.com/about-us/our-people/

Disc: LYL is my second largest real-life position, and one of my two largest positions here also.

And that's why if you Google "Lycopodium", you'll likely get images like this:

Instead of images like this: